The current economic crisis has affected the volume of business class and private flights which have been partially redirected to the offers of low cost carriers.

This flow is related to the need of many companies to reduce costs, but does not mean that if the price is right, there is no demand for the service, especially when savings in the ticket price may be counterbalanced by the long hours company executives spend in boarding queues, check in desks, and waiting for delayed flights, missed connections, etc.

Some planned initiatives in Spain to offer private flights at a moderate cost have not proved feasible, mainly for not having the right aircraft. It seems that the Eclipse 500 model that had been chosen originally because of its advantage of operating at a cost of approximately €1,500 an hour, with capacity for four passengers, failed, when in 2009 the  European Aviation Safety Agency withdrew the certification that had been originally approved on 21st November 2008. EASA stated that the certification had been withdrawn due to “administrative as well as technical reasons.” These reasons were related to financial problems,  to the Eclipse’s outstanding obligations against EASA, and payment for certification services.

Other companies seem to have had better fortune in this field; NetJets, with more than 150 aircraft, is the largest business jet company in Europe with 1,600 customers, flying to over 5,000 airports around the world. Their model is based on paying for flight hours, through the purchase of 16 to 50 hour vouchers, giving a choice of any aircraft in its fleet.

At first glance this would seem to be a luxury service, but in order to make a more accurate judgement it would be necessary to conduct a cost/ benefit analysis and work out  whether the hourly rate is worthwhile.

 
http://www.almaclub.com/blog/category/lujo/
http://www.netjetseurope.com
http://www.expansion.com/2009/07/20/empresas/minegocio/1248116834.html
http://www.jetready.es/

These experiences are remembered, are etched on our memory for years, and this is the starting point for experience marketing strategies. If consumers associate a brand or product with a powerful experience, then a very special bond is created..

One initiative that is attracting interest is zero-gravity flights. If the selling point of  these flights is the feeling of being as light as a feather, then it is surely possible for this feeling to be associated with the many brands or products that incorporate this as part of their values. It is of particular interest for these flights to be used as rewards or gifts in communication campaigns.

They are also equally interesting as alternative entertainment and although they cost around $ 5,000, this seems to be no obstacle for those wishing to enjoy the feeling.

Among other companies, ZERO-G (zero gravity) offers the service out of McCarran International Airport. Aboard a modified Boeing 727, passengers experience a series of 15 parabolas (something like a row of rolling hills) that when a specific speed is reached, including certain scientific factors, intervals of 30 seconds of weightlessness are created for those aboard. A special suit is provided as a keepsake, a party is laid on  after landing, and an official certificate proving the achievement is awarded.
  

Sources:
http://espanol.vegas.com/attractions/off_the_strip/zerog.html #
http://www.microsoft.com/business/smb/es-es/marketing/marketing_sensorial2.mspx

Flying in the lap of luxury seems to be becoming restricted to a lucky few.

In 2009 the IATA (the International Air Transport Association) stated that a large number of business passengers had chosen to switch to cheaper services, forgoing business class flights, often going for low cost airlines that in order to take advantage of this trend, have opted to attract and retain these new customers with specially developed products and services.

This change in habits has had very negative effects on the financial results of certain airlines. Business class is highly profitable for these companies and, according to IATA statistics, the income from premium tickets, a category comprising first and business class, fell by between 40 and 45% in May 2009 compared to the same month in 2008. This does not appear to be a cyclical downturn that is going to change in the near future.

Given this situation the luxury flight market provides good examples of strategies with excellent results. This is the case of Virgin Atlantic which earned pre-tax profits of 68.4 million pounds (77.9 million euros ) during the 2008 financial year (March 2008 to February 2009), compared to 34.8 million pounds (39.6 million euros) for 2007. Richard Branson attributed the result to the increase in passengers travelling in premium class and the “prudent” management of the airline.

One emerging resource making  luxury flight services stand out is to offer special benefits that customers  perceive as decisive in making their choice. Virgin has renamed its first class service as Class Suite, offering pre and post-flight beauty treatments from London’s Heathrow airport. Its Flying Club offers its VIP customers competitions with prizes such as Helicopter rides in the Grand Canyon or stays at Richard Branson’s Caribbean hideaway.
Sources:

http://www.lineasaereas.travel/2009/08/17/las-aerolineas-estudian-suprimir-la-clase-business/

http://www.trotamillas.es/4789/emirates-virgin-atlantic-lujo-por-los-aires/

http://www.cotizalia.com/cache/2009/05/26/noticias_62_virgin_atlantic_duplica_beneficio_antes_impuestos_hasta.html
http://www.radiocable.com/airbus380.html

http://www.abc.es/20090817/economia-empresas/aerolineas-estudian-suprimir-clase-20090817.html
http://www.revistaviajar.es/Brujula/Las-First-Class-mas-04-2006-2769.html

 http://www.virgin-atlantic.com/en/us/whatsonboard/upperclass/cabin/index.jsp

Users’ decisions about which is the best choice on those routes where both services are available are based on four main variables: Cost of service: if the price difference is not too great then this will be the least important variable.

Journey time: airlines have the edge in this respect, although technological advances in high speed rail travel and the creation of routes with a minimum number of intermediate stops will reduce this difference.

Waiting time: this is the key to choice. Airlines have the advantage in shorter journey times, but when the time required for checking in and boarding the total time increases significantly. In comparison, high speed train travel is much less demanding in this respect, users are not required to be at the station as far ahead as they would be at the airport.

Access at origin and destination: many airports are located on the outskirts of cities, which means that an additional land journey must be made in order to access the desired source-destination.

High speed trains, however, usually stop at a main station in the city centre, preventing or significantly reducing further displacements. Although the contest is open (especially for shorter and middling distances), it is also possible for valuable partnerships to be developed between these two means of transportation.

One option could be to work together in cases where high speed trains could link a city with a major international airport with one that doesn’t. Long-haul flights could then perhaps increase the amount of passengers from neighbouring regions through this rail connection.

Sources: http://www.transport.cat/viewtopic.php?f=14&t=6913 http://www.elperiodico.com/default.asp?idpublicacio_PK=46&idioma=CAS&idnoticia_PK=389104&idseccio_PK=1021

Airlines are have their share of responsibility in the generation of negative impacts on the environment due to CO2 emissions into the atmosphere.

Some airlines have taken steps to lessen these impacts, however as yet they do not seem to be sufficient. The more efficient actions point to the need for more modern fleets, meaning reduced fuel consumption and therefore lower emissions, as well as searching for and using new, less contaminating fuels. Both measures require substantial investments for their implementation and although immediate benefits will be gained by the environment, businesses fear a high financial impact in their structures in the short term.

However, even if these investments do take place, the reduction of emissions will be neutralised if the number of flights increases.
 
The Spanish Association for Standardisation and Certification (AENOR) awarded its first Certificate for Reduced CO2 Emissions to Iberia in May 2009, for the airline’s reduced carbon dioxide emissions in its Madrid-Barcelona shuttle service following the implementation of several measures to improve efficiency.

Some of the changes implemented included the replacement of Boeing 757s and McDonnell Douglas 87 and 88s with the new Airbus A319, A320 and A321 and the installation of new, lighter seats.

The reduction of CO2 emissions in 2008 stood at 12,124 tonnes, representing a decrease of almost 7% in emissions over what the figures would have been had the improvements described not been implemented..

Another way of compensating for carbon emissions appeals to user awareness. Airlines such as KLM offer their customers the possibility to calculate the emissions they produce each time they fly and to make donations in order to finance clean energy projects.
Sources:
http://www.geoscopio.com/guias/cont/noticias/AENOR_certifica_la_reduccion_de_emisiones_de_CO2_del_Puente_Aereo_de_IBERIA_10749.htm

 http://www.klm.com/travel/travel_es/about/co2/klmdoing/plan.htm

At certain times all organisations face critical moments, unexpected events with unforeseen consequences. These may affect the company itself as well as having potential knock-on effects on customers and stakeholders.

Both airlines as well as airports will have to face such situations fairly regularly, ranging  from delayed or cancelled flights to other more serious incidents.

Successful crisis resolution will find a solution to any problem that has occurred, but will also successfully manage communication.

Many corporate crises have been  either resolved or aggravated through communication (whatever the real problem may have been).
 
To avoid adverse effects it  is important to consider the development of an anti-crisis plan.

All plans by definition are based on anticipation., involving a preventive approach, where potential critical situations (for industry, business, services) have been taken into consideration and evaluated.

Once the crisis has been declared, flexibility in action will be of prime importance. The problem must be addressed right from the outset, without hesitation, employing quality, truthful information, that is to say providing explanations for all the facts and actions employed in the resolution process.

This does not mean that some information is not to be held back or released at a time when it becomes relevant and can be used to make a contribution to the solution, not beforehand, as long as the process is kept clear and unambiguous.

Having a good communication plan for the management of internal and external perceptions, will not only maintain but increase the reputation and credibility of a company.

 Sources
http://www.aerohabitat.org/link/2006/06-01-2006% 20 -% 20AENA,% 20Gestion% 20of% 20the% 20Seguridad% 20Crisis% 20 (2MB). pdf
http://www.ucm.es/info/mdcs/ComCrisis.pdf

 Image:
http://www.flickr.com/photos/29487546@N07/3192333420/

One basic premise of a good job of marketing is to not lose sight of who the customers are and of their needs and preferences. The performance of a good segmentation of the target can become a valuable technique towards the identification of interesting business opportunities.

Sometimes the identification of even minority interests may be enough for building a new product or service or even a new business. One case in hand is Pyrenair, an airline designed with skiers in mind.

With the objective of meeting the needs of this very specific group it is now in its third season flying to Huesca, linking the Aragonese Pyrenees with Valencia, La Coruña, Palma de Mallorca, Madrid and via Barajas, the Canary Islands.

The initiative was the brainchild of two keen skiers who are well aware of the requirements of their target group. Juan Manuel Viu works for Iberia and among other feats, he participated in a Spanish expedition that crossed Antarctica on a kite-powered catamaran, while managing director Hugo Puigdefábregas was part of the Spanish national cross-country ski team. “We had this nice idea eight years ago – fun but a bit crazy too. It’s weird  because in Spain there is no real culture of flying – unlike the USA or even France, where even your grandma takes the plane.  Our original approach was much more bucolic, involving small aircraft and high altitude airports, but we soon realised that something much more commercial, profitable and practical was required.”

One of the keystones of their  business lay in finding the right airport from which to operate; they finally settled for Huesca airport, starting operations in 2007. The airport is generally quiet but becomes a hive of activity on Friday and Sunday evenings which is when Pyrenair concentrates its services. 

These schedules are designed for weekend travellers and those extending their stay to a full week. The demands of skiers accessing the area tend to be split between  these two options. And though a flight does cost more than a car journey, the benefits, especially the trip back after a long, exhausting day on the pistes, have enjoyed a positive reception.

There are no baggage restrictions or extras for carrying equipment, a detail which is highly valued by users. Inflight customer care also includes catering specially designed with sportsmen and women in mind and up to date information on the state of the pistes.
 
Complete travel packages including accommodation and ski pass are being sold along with the flights.

The airline does not actually own the aircraft it operates; it has reached a commercial agreement with Air Nostrum to provide the service, which according to Pyrenair’s managing director is one of the keys to the airline’s survival and success.
“All the regional airlines are folding and I think largely that’s why. We move souls and let Air Nostrum be moves the metal”.

This type of business model geared to specific market segments can generate exciting returns and obtain high levels of loyalty given that it is aimed at a target with very specific needs – if these needs are met then customers will be likely to return and to recommend the service.
 
Many other applications can be taken into consideration,  taking specific destinations and target groups into account. Perhaps getting away from the cold, the next step could be an airline specializing in surf destinations.

Sources.

http://www.nevasport.com/noticias/d/18420/pyrenair–una-compania-de-esquiadores-pensada-para-esquiadores
http://www.pyrenair.es/2009/paquetes/index.php

Inflight advertising is not a new concept. Personalised spaces or objects such as headrests,  trays as well as magazines and audiovisual messages have all been used for advertising purposes.
 
This additional source of revenue for airlines may mean lower prices for other items and for advertisers it can represent an ideal opportunity to reach a highly receptive audience that is literally captive.

Here are some statistics:

QMedia
 
85% of long-distance travellers recalled some type of inflight advertising or promotional material. The figures were higher for business class and high frequency passengers.
 
86% of customers are flying in a positive mood, and are hence more likely to be receptive to advertising messages.

Triad Consulting Group

On flights of over an hour, 9 out of 10 airline passengers used their tray for 15 minutes or more. In short flights of an hour or less, the figure stood at 82%

92% of airline passengers were still able to recall advertising messages a few hours after arrival.

This would seem to be an appealing way of getting to potential customers but only insofar as it responds to the right strategy. Advertisers base their choices on the type of airline, on different routes, on the different formats available and their cost. This does mean that the airline will obtain a source of revenue; however certain working guidelines must be established in order to preserve its relationship with travellers, preventing them from being bombarded with advertising to a point that could be considered annoying or aggressive.

This should be taken as an opportunity to for creative and customer-oriented communication, avoiding any practices that could cause customer rejection.

One case that has enjoyed high levels of customer approval are Emirates’ inflight magazines.

Emirates publishes three magazines, Open Skies, Portfolio and TV & Radio with  the idea of making contact with its more sophisticated readers.

The first is a lifestyle magazine reflecting the cosmopolitan character of its readership, including stories from around the world covering such diverse topics as travel, technology, health, the environment, art, culture, food, business and adventure.

Portfolio is a business magazine aimed exclusively at First Class and Business Class passengers including interviews and profiles related to business topics and current affairs.

TV & Radio is an entertainment guide providing listings for the inflight entertainments programmes available on the different routes operated by the airline.

The advertising included in these publications is not invasive; on the contrary, travellers are provided with added value and entertainment,

Other promotional options are also possible, such as the campaign carried out by La Prairie where first class passengers travelling with Qantas, Swiss International Air Lines, Malaysia Airlines, Lufthansa and Eva Air were delivered with a gift set of the company’s cosmetics.

It is obvious that it is highly important that the values of the brands choosing to advertise on board and the airline are in line. Luxury products would not reach their target audience by focusing on low-cost airlines; it would seem more reasonable to advertise with traditional airlines, particularly to first class passengers. On the other hand, other products such as those aimed at students may well find their potential market  in low-cost airlines.

It is therefore possible to devise well-received, attractive and lucrative advertising adjusted to specific  target audiences with the benefits being shared by airlines, advertisers and the target audience, as long as certain standards of respect and non-invasion of travellers’ privacy are kept.

Sources:

http://www.smartertravel.com/blogs/up-front-with-tim-winship/airlines-will-increase-in-flight-ad-volume.html?id=2632106

http://www.onboardeuropa.com/uploads/video/625720_282550_statistical_studies_for_onboard_advertising.pdf

http://www.emirates.com/us/english/about/inflight_advertising.aspx
http://www.bellezapura.com/tag/la-prairie/

Improvements in distribution are important because regular customers may sometimes require to fly to other destinations than those offered by the airline in question. Code sharing  partnerships mean that this customer service becomes available, entailing at the same time a business opportunity.

The seat-booking systems of the airlines wishing to participate should be prepared for code sharing.

Usually two roles are delimited between the companies:
Operating Airline
Marketing Airline.

The operating airline sells its own operating routes, while the marketing company receives a commission related to the distribution expenses incurred by the company in selling the seats.

The most common modalities of agreement:

Free sale

There is free availability of seating for both companies and the marketing airline is set no sales limits. Revenue goes to the operating company, which pays a commission to the  marketing company.

Block space

In which both airlines share the plane with an assigned number of seats to be sold by each company.

In this way each airline receives revenue from the sale of the seats. This modality can be carried out in two different ways:

Hard block, in which each airline is responsible for handling their own seats

Soft block, which allows the marketing airline to return any unsold seats.

As in any strategic alliance, the outcome will be favourable if the services are well-aligned. The destinations provided should supplement those already available, allowing good links between routes etc. But there is also a need for consistent levels of service, so that customer perceptions are balanced and in line with the values of the operating company, which at the end of the day is the airline the customers know and contact in order to buy their seats.

The benefits are obvious and to be gained by both companies. The marketing airline will increase the number of destinations it can offer to its customers without having to go to the expense of transporting small numbers of passengers that would not justify the cost of running a service. The operating company will increase the occupancy rates of its scheduled flights.

There are also advantages for frequent flyers. These include:

The possibility of including the whole journey in one ticket (in cases of combinations of several flights).
 The accumulation of points in a single loyalty scheme (it is customary to provide this service in this type of agreements).
Luggage is sent to the final destination.

One  recent example is the case of Spanair, and Brussels Airlines who will run a joint service using code sharing from January; this will affect the airports of Bilbao, Barcelona, Madrid, Malaga and Seville, where passengers will be able to purchase direct connections to Brussels with the Belgian Airline through Spanair. Palma de Mallorca is to join the scheme in the summer season.

Spanair’s CEO, Michael Schulz stressed that this initiative is part of a broader business strategy with companies in the Star Alliance airline group.
Sources:
http://www.dvuelos.com/codigo-compartido-code-share/
http://es.wikipedia.org/wiki/C% C3% B3digo_compartido
http://www.nouciutat.es/actualidad/economia-y-turismo/8513-spanair-y-brussels-airlines-volaran-en-codigo-compartido-a-partir-de-enero.html

It has become increasingly more difficult to do without an internet connection, both professionally and personally. It is for this reason that the possibility of wi-fi connections in airports and airlines is such an appealing proposal.

Google has made the wishes of many Internet users come true in the form of a Christmas gift. This is certainly going to have a major impact at a time of the year when many people are travelling and air traffic is intense. Free wi-fi will be made available at 47 U.S. airports up to the 15th  January.

This scheme also has its share of seasonal goodwill. When travellers connect to the network at any of the airports participating in the project, they can decide whether to make a donation to three different charities; these donations will then be doubled by Google.

Virgin America has also joined the initiative, providing an in-flight  wi-fi service for passengers during the holiday season.

eBay has also supported the proposal, providing free wi-fi on some Delta Airlines flights on Thursday 26th  October during Thanksgiving week. The connection led users to the eBay site, but once there they were free to browse as they wished. 

Clearly, passengers value free wi-fi  highly and integrating it into the regular services proffered by airports and airlines could well bring about improvements in their differentiation and positioning. In business flights the availability of this service could make the difference in one airline being selected over another.

Some participating airports, like McCarran International in Las Vegas,  are already providing free wi-fi continuously. This service is maintained by sponsors.

It is difficult to calculate the volume of additional contacts and transactions that may result from the availability of this service, some being directly related to airports and airlines, others evidently directed to other sectors. Such initiatives may well be an interesting way for brands to get publicity, obtaining high visibility, meaning successful sponsorship and online promotion. Users will be receptive to information or other proposals in return for the free service, as long as not too much of their time is taken up; the proposal should also be both original and good value and the option for free use of the connection should be made available promptly.

Sources:

http://spanish.peopledaily.com.cn/92121/6811354.html
http://www.laflecha.net/canales/wireless/noticias/google-yahoo-ebay-y-microsoft-ofreceran-wi-fi-gratis-en-multiples-lugares-publicos/

Image

http://www.flickr.com/photos/gretchen_ross/2078669732/